NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
NEW DELHI
ORIGINAL PETITION NO. 50 OF 2000
K. Yusuf Basha
4/59, Bharathi Street,
Swarnapuri,
Salem – 4 … Complainant
Versus
Bharath Earth Movers Ltd.,
Regional Office
Unity Buildings Vth Floor,
J.C. Road,
Bangalore – 560 002. … Opposite Party
ORIGINAL PETITION NO. 51 OF 2000
K. Shahnawaz
4/59, Bharathi Street,
Swarnapuri,
Salem – 4 … Complainant
Versus
Bharath Earth Movers Ltd.,
Regional Office
Unity Buildings Vth Floor,
J.C. Road,
Bangalore – 560 002. … Opposite Party
ORIGINAL PETITION NO. 61 OF 2000
K. Shoukath Ali
4/59, Bharathi Street,
Swarnapuri,
Salem – 4 … Complainant
Versus
Bharath Earth Movers Ltd.,
Regional Office
Unity Buildings Vth Floor,
J.C. Road,
Bangalore – 560 002. … Opposite Party
BEFORE:
HON’BLE MR. JUSTICE R.C. JAIN, PRESIDING MEMBER
HON’BLE MR. S.K. NAIK, MEMBER
For the Complainant(s)
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Mr. V. Prabhakar, Advocate
| |
For the Opposite Party
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Mr. Akhil Sibal, Advocate
Ms. Priya Deep, Advocate
Mr. Pradeep Chhindra, Advocate
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PRONOUNCED ON : 29th MAY, 2012
O R D E R
PER JUSTICE R.C. JAIN, PRESIDING MEMBER
As these complaints are based on similar facts and involve the same dispute / controversy, it is proposed to decide all the three complaints by means of this common order.
2. The dispute raised in these complaints pertains to four numbers Heavy Earthmoving Machine (Hydraulic Excavator) used for mining activity in granite mines. Complainants in these complaints are partners of KMB Group, Salem engaged in granite quarry and export business. Opposite Party, Bharath Earth Movers Ltd. (BEML), is a Government of India undertaking and is engaged in manufacturing of such like machines. In the year 1997, K. Yusuf BashaComplainant in Original Petition No. 50/2000, had purchased two Heavy Earthmoving Machines (Hydraulic Excavator) from the OP, at a cost of Rs.57,63,000/- for each machine with the following description:-
“(i) BEML Model BE 300 Hydraulic Excavator powered by BEML KOM S6 D 125 diesel engine (developing 197 FHP) equipped 1.57 cum bucket. Equipment serial No. G 10258, Chasis No. 258 and Engine No. Z311600091.
(ii) BEML Model BE 300 Hydraulic Excavator powered by BEML KOM S6 D 125 diesel engine (developing 197 FHP) equipped 1.57 cum bucket. Equipment serial No. G 10261, Chasis No. 260 and Engine No. Z311600093.”
3. Similarly, K. Shahnawaz, complainant in Original Petition No. 51/2000, also purchased one Heavy Earthmoving Machine (Hydraulic Excavator) from the OP at a cost of Rs.57,63,000/-, with the following description:-
“BEML Model BE 300 Hydraulic Excavator powered by BEML KOM S6 D 125 diesel engine (developing 197 FHP) equipped 1.57 cum bucket. Equipment serial No. G 10260, Chasis No. 261 and Engine No. Z311600092."
4. Similarly, K. Shoukath Ali, complainant in Original Petition No. 61/2000, had also purchased one Heavy Earthmoving Machine (Hydraulic Excavator) from the OP at same price, with the following description:-
“BEML Model BE 300 Hydraulic Excavator powered by BEML KOMTSU 6 D 125 diesel engine (developing 197 FHP) equipped 1.57 cum bucket. Equipment serial No. G 10257, Chasis No. 267 and Engine No. Z311600089."
5. The above-mentioned machines were commissioned at the sites of the work of complainants on 6.11.1997, 25.12.1997, 17.11.97 and 8.11.1997 respectively. The machines carried warranty of one year or 2000 hours of operation from the date of initial commissioning of the equipment, whichever event occurred earlier and for the engine and hydraulic for one year or 3000 hours from the date of initial commissioning. That apart the opposite party had undertaken to service the machinery first at 250 hours and second service at 500 hours.
6. According to the complainants from the very first day their commissioning, the machines started giving trouble due to manufacturing defects and faced a lot of major problems in the under carriage and engine and there was heavy oil consumption. The service engineers of the OP though made several trips to repair the machines on various dates between November, 1997 to February,1999, but all the defects could not be removed and the machines could not be made fault free. The main defect alleged in the machines was in respect of heavy consumption of Hydraulic and Engine Oil which could not be rectified thereby causing heavy monetary loss to the complainants. According to the complainants, it was on account of the manufacturing defects in the engine in the Hydraulic system which led to the consumption of heavy oil ever since the date of commissioning. Besides that the equipment had other major problems in the undercarriage. The track frame supplied by the OP after enormous delay was not re-commissioned for want of service engineers. The complainant had to purchase quite a large number of spare parts at their own cost for replacement of the defective parts. Alleging deficiency in service on the part of the opposite party, the complainants have filed these complaints. In OP No. 50 / 2000 relating to purchase of two machines, the complainant has claimed a total compensation of Rs.5,61,32,180.00/- the break-up of which is as follows:-
“(A) Machinery and Equipment No. 10258 at Edapadi quarry was lying idle for 189 days from 06.11.97 to 10.09.99
(1)
|
Loss of Net Profit due to production loss of 1266.3 cbm of Imperial White Material at Rs.39,000/-
|
3,06,26,000.00
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(2)
|
Amount payable to the Ashok Leyland Finance Ltd., for the purchase of the machinery at Rs.1,66,430/- monthly 22 instalments
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36,61,744.00
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(3)
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Cost of spare parts purchased during warranty period
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6,51,560.00
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(4)
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Value of excess oil consumed.
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2,41,340.00
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(5)
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Loss of interest @12% p.a. for the 30% down payment.
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4,14,936.00
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TOTAL
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3,55,95,580.00
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(B) Machinery and Equipment No. 10261 at Ongole quarry was lying idle for 311 days from 24.12.97 to 10.9.99
(1)
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Loss of Net Profit due to production loss of 2083.7 cbm of Black Galaxy Material at Rs.55,000/-
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1,69,60,000.00
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(2)
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Amount payable to the Ashok Leyland Finance Ltd., for the purchase of the machinery at Rs.1,66,430/- monthly 15 instalments
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25,02,375.00
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(3)
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Cost of spare parts purchased during warranty period
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5,39,444.00
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(4)
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Value of excess oil consumed.
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1,19,845.00
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(5)
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Loss of interest @12% p.a. for the 30% down payment.
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4,14,936.00
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TOTAL
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2,05,36,600.00
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Total Amount A + B = 5,61,32,180.00”
7. In OP No. 51 / 2000 relating to purchase of one machine, the complainant has claimed a compensation of Rs.2,42,50,670.00/-, the break-up of which is as follows:-
“Machinery and Equipment No. 10260 at Thogamalai quarry was lying idle for 200 days from 27.11.97 to 10.09.99
(1)
|
Loss of Net Profit due to production loss of 1340cbm of Colombo Juparana Material @ 200 cbmat the rate of Rs.29,000/- for 200 days from 07.11.97 to 10.9.99
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1,84,73,333.00
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(2)
|
Amount payable to the Ashok Leyland Finance Ltd., for the purchase of the machinery at Rs.1,66,430/- monthly 22 instalments
|
36,61,744.00
|
(3)
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Cost of spare parts purchased during warranty period
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12,13,796.00
|
(4)
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Value of excess oil consumed.
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4,86,860.00
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(5)
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Loss of interest @12% p.a. for the 30% down payment.
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4,14,937.00
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TOTAL
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2,42,50,670.00
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8. In OP No. 61 / 2000 relating to purchase of one machine, the complainant has claimed a compensation of Rs.1,82,37,330.00/- the break-up of which is as follows:-
“Machinery and Equipment No. 10257 at Varahanapalli quarry was lying idle for 207 days from 7.11.97 to 10.09.99
(1)
|
Loss of Net Profit due to production loss of 1386.9 cbm of Bash ParadisoMaterial @ 200cbm at the rate of Rs.25,000/- for 207 days from 07.11.97 to 10.9.99
|
1,35,99,900.00
|
(2)
|
Amount payable to the Ashok Leyland Finance Ltd., for the purchase of the machinery at Rs.1,66,430/- monthly 22 instalments
|
36,61,744.00
|
(3)
|
Cost of spare parts purchased during warranty period
|
4,36,010.00
|
(4)
|
Value of excess oil consumed.
|
1,24,740.00
|
(5)
|
Loss of interest @12% p.a. for the 30% down payment.
|
4,14,936.00
|
TOTAL
|
1,82,37,330.00
|
9. Opposite Party, BEML after notice on the complaints contested the complaints and have filed separate but identical written version to the complaints. In their written versions the opposite party had raised several preliminary objections about the maintainability of the present complaint in the present form. In the first instance it is stated that the complainants are not consumers within the meaning of section 2(1) of the Consumer Protection Act, 1986 (in short ‘the Act’), therefore, they are not entitled to file the present complaint and institute the present proceedings as the goods supplied were meant to be used and were actually used for commercial purpose which takes the complainants outside the purview of the Act. It is explained that the hydraulic excavator are used for mining activity and to enable the complainants to carry on the commercial activity of granite excavation and export business, which shows that there is a close and clear connection between the purpose of purchase of hydraulic excavator and the commercial activity of granite quarrying. In any case, hydraulic excavator are designed and intended to be used in facilitating excavating activity in huge mines for the purpose of trade. Yet other objection raised by the opposite party is that the complainants are neither the original purchaser who are using the goods under approval of the original consumers. The complaint is based on suppression of material facts and has been filed with malafide and vexatious objectives to harass the OP and in order to extract money without any cause of action. Complaints are otherwise stated to be misconceived and not maintainable as the complainants have not suffered any loss or damage and the complaints are absolutely based on fake and imaginary allegations. OP has not committed any breach of any terms of the warranty and rather provided excellent services. Another main objection about the maintainability of the complaints is that the complaints are barred by limitation, since the machines were purchased sometime in Sept. 1997 and the limitation of two years as provided under section 24(a) of the Act expired on 27.09.99. Therefore, the present complaints filed in Feb. 2001 are clearly barred by limitation.
10. On merits it is not disputed by the opposite party that the above referred machines were supplied to the complainants and were commissioned at the worksites of the complainants on the dates between 6.11.97 to 25.12.1997. It is also not disputed that the machines carried a warranty of one year or 200 hours and that two free services were provided when the machine had run for 250 hours and 500 hours respectively. It is specifically denied that the machines suffered from any defects, much less any manufacturing defect and that the complainants faced any major problems in the undercarriage and /or on account of heavy oil consumption as alleged by the complainants. It is denied that the service engineer of the opposite party had ever accepted the problems as alleged by the complainants and have consented for free replacement of undercarriage and spare parts for the above equipment. As regards the heavy consumption of oil etc., it is sought to be explained that the hydraulic excavator are huge machines, and when used in quarry(s) have to be operated under the maximum conditions. Under such extreme pressures working at highest capacity levels, the Oil consumption generally tends to be high, which is a known fact and cannot be termed as a manufacturing defect. As regards the service reports, it is stated that at all relevant times, the complainant had expressed satisfaction about the service provided by the OP. It is denied that service engineer had ever noted any manufacturing defect or abnormal wearing out of under carriage. ‘Failure Details’ mentioned in the service reports are denied and it is sought to be explained that the same would usually be noted subject to satisfaction and convenience of the complainants, who would insist that his narration be recorded for which the complainants is put to strict proof. It is admitted that a meeting had taken place between the representatives of the complainants and the OP on 18.05.1998 but it is stated that pursuant to the said meeting it was decided that certain items as detailed in para 3 of the minutes were agreed to be replaced under warranty in order to make the equipment to perform better and also avoid “off road” conditions. It is further explained that certain items were replaced more as a matter of courtesy rather than as an obligation going by the terms of contract. It is also pleaded that many times defects which were found were attributable to the mishandling of the equipment at the hands of the complainants. Any deficiency in service on the part of the OP is specifically denied. Liability to pay any compensation much less the compensation as claimed in the complaints is denied.
11. In their rejoinder the complainants, have controverted the objections and pleas raised in the written versions and have generally reiterated the averments and allegations made in the complaints.
12. In order to substantiate their respective pleas, the parties have largely relied upon the documentary evidence produced on record in the form of various commissioning/service reports of the machines between the date of commissioning i.e. November, 1997 to February, 1999, voluminous correspondence exchanged between the parties as also the certain reports of inspection and minutes of the meeting held between the representatives of the complainants and opposite party/BEML in May, 1998.
13. Parties have also filed supporting affidavits. From the side of the complainant affidavit of Mr. K. Yusuf Basha, complainant in Original Petition No. 50 of 2000 has been filed while in other complaints affidavit of Mr. K. Shanawaz in Original Petition No. 51 of 2000 and affidavit of Mr. K. Shoukath Ali in Original Petition No. 61 of 2000 have been filed. From the side of the opposite party/BEML affidavit of Mr. Hardeep Singh has been filed. Opposite party sought permission to cross-examine the complainants’ witnesses but the Commission permitted the opposite party to serve a set of interrogatories on the witnesses of the complainants, which were duly answered. We have gone through the entire evidence and material produced on record and have heard Mr. V. Prabhakar, Advocate learned counsel representing complainants in these complaints and Mr. Akhil Sibal, learned counsel representing opposite party/BEML at length and have given our thoughtful consideration to their respective submissions.
14. Going by the objections and pleas raised by the OP/BEML in their written version, it is desirable to advert to the said objections before we consider the complaints on its merits. The first and foremost objection raised by the opposite party is that the present complaint is not maintainable before a Consumer Foralike this Commission because the complainants are not consumers within the meaning of Section 2(1)(d) of the Act inasmuch as the complainants are engaged in the commercial activity of granite excavation and export business and they had purchased the hydraulic excavators for commercial purpose and were meant only to be used for excavating activity in huge mines for quarrying purposes. In any case, it is pleaded that the very foundation of the present complaint is the alleged manufacturing defect (s) in the machines supplied by the opposite party to the complainants. During the course of his submissions, Mr. Akhil Sibal, learned counsel representing the O.P. vehemently argued that by filing the present complaints, the complainants have made an attempt to misuse the jurisdiction of this Commission in direct route through Clause (II) of Section 2(1)(d) of the Act alleging deficiency in service on the part of the opposite party. On the other hand M. Prabhakar contended that the complainants are well within their rights to invoke the original jurisdiction of this Commission for the alleged defects in the goods supplied and deficiency in service rendered by the opposite party in relation to the said goods. Having considered the respective submissions we are of the view that strictly going by the provisions of Section 2(1)(d) of the Act as it stood prior to its amendment by the Amending Act-62 of 2002 effective from 15.03.2003, a complaint alleging defects / manufacturing defects in goods purchased for commercial purpose could not be maintained before a Consumer Fora, because of the definition of ‘Consumer’ as it then existed. However, there was no bar for entertaining a complaint alleging deficiency in service, even if the service was obtained by a consumer for commercial purpose. However, the Amending Act has brought a sea change in the definition of the term ‘Consumer’ appearing in Section 2(1)(d) and after the amendment any person who avails the service from a service provider for commercial purpose has been taken out of the purview of the definition of ‘consumer’. As noticed above from the narration of the facts and circumstances of the complaints, it is true that one of the grievances of the complainants is that there were manufacturing or inherent defects in the machines and equipments supplied by the opposite party. However, at the same time, the complainant has in detail alleged several acts of omission on the part of the opposite party/its functionaries in rectifying the defects in the machines during the warranty period which according to the complainants amount to deficiency in service. This would show that the present complaints are not based only on the allegations of manufacturing or inherent defects in the goods supplied by the opposite party but the complaints are based on the allegations of deficiency in service as well. Therefore, at best it can be said that the complainants are not ‘Consumers’ under Clause 2(1)(d)(i) of the Act but they are certainly consumers under Section 2(1)(d)(ii) of the Act as the complaints were filed i.e. prior to the amendment of the definition of the term ‘Consumer’. We are therefore, of the view that even if we may not look into the allegations of defects in the goods but the complaints cannot be thrown outatleast and in so far they allege deficiency in service on the party of the opposite parties. The complaints were admitted by this Commission as far back as in the year 2000 and it will be totally unjust to throw away the complaints at this stage on the ground that the same are not maintainable before this Commission.
15. The next objection of the O.P. which has been pressed at the time of hearing is about the complaints being barred by limitation. According to Mr. Sibal as per the complainant’s own showing, the cause of action, if any, for filing of the present complaints had arisen between 06.11.1997 to 25.12.1997 during which period the four machines were commissioned at the work site of the complainants. Since the present complaints were filed only in the year 2000 the complaints are barred by limitation of two years as prescribed under section 24(a) of the Act. In support of his contention counsel sought heavy support from a decision of a Coordinate Bench of this Commission in the case of “Ishwarlal Amarnani Vs. Hero Puch and Ors. [Manu/CF/0078/2011]” In that case, the complainant had purchased a two-wheeler vehicle from the respondent in the year 2000 with a warranty of two years and had approached the consumer forum in 2003 alleging deficiency in service in rectifying the defects regarding high consumption of fuel and problem with steering in the two wheeler. In reply, the respondent took up the objection that the complaint was barred by limitation as the cause of action had arisen with the purchase of the vehicle in 2000 whereas the complaint had been filed in the year 2003. The complainant had contended that the limitation period would start running not from the date of purchase of the vehicle but from the date when the respondents failed to remove the defects. This Commission repelled the said contention by holding as under:-
“The contention of the Petitioner that the period of limitation will start when the Respondent failed to rectify the defects is not tenable. Section 24-A of the Act is a legislative mandate to the consumer Fora not to admit a complaint unless it has been filed within two years from the date on which the cause of action has arisen except when the complainant satisfies the forum that there was sufficient cause for not filing complaint within time.”
16. Mr. V. Prabhakar, countered the above contention of the OP by submitting that in the present case, cause of action was a continuing one because the contract of sale of equipment was coupled with agreement of warranty and since the complainant has alleged defect in the service performed by the OP, i.e., it failed to rectify several defects and in particular about the excessive consumption of hydraulic and engine oil, which continued up-till Feb. 1999, the complaint filed in 2000 is well within the prescribed period of limitation. In any case, our attention has been drawn to a communication dated as late as 6th Feb. 1999 by which the Opposite Party had re-appreciated the problems of the complainants arising out of the defects in the track frame, engine problem and spare parts, etc. and assured the complainants to expedite decision and to rectify any problem and improve the condition of the engine.
17. Having given our anxious consideration and having regard to the peculiar facts of this case that even after the expiry of the period of warranty, OP had assured the complainant and continued to provide requisite service to rectify certain defects, the limitation would be deemed to have been extended because according to the complainants the said defects were not fully rectified. This will amount to continuing cause of action at least uptil Feb. 1999. Therefore, the complaints filed in the year 2000 are well within the period of two years. The complaints were admitted by the Commission as far back as in the year 2000 itself and notice were issued to the OP. That must have been done after satisfying that the complaints were filed within the prescribed period of limitation and were maintainable. Therefore we must reject this objection. In any case we would not like to non-suit the complainants on this ground at this stage when the complaint has already been under trial for a period of more than a decade.
18. Coming to the merits of these complaints, we have already noted that the grievance of the complainants in these complaints is two-fold, one being about the manufacturing/inherent defects in the machines supplied by the opposite party and the other is about the deficiency in service on the part of the opposite party arising out of their omission to repair the machines and rectify all the defects after the machines were commissioned during the period of warranty or thereafter. So far as the first allegation is concerned, we cannot go into the question of the manufacturing or other inherent defects in the machines as that would be beyond the scope of this Commission. In any case the complaint based on those allegations would be barred by limitation as the machines after their supply were commissioned at the work sites of the complainant between 06.11.1997 to 25.12.1997 and the complaint was filed in the year 2000. Therefore, we must necessarily restrict our consideration to the allegations of deficiency in service made in the complaints, although Mr. Prabhakar strongly argued that the opposite party had admitted manufacturing defects like misalignment and structural defects in one of the machines at the time of commissioning of the machine. Even if it was so, we cannot look into that aspect.
19. As regards the deficiency in service on the part of the O.P. in repairing the machines and rectifying the defects, several instances of such omissions have been cited. In order to establish the same, the complainant has mostly relied upon various service reports of the service Engineer/Mechanics of the opposite party, who were deputed to attend the complaints at different point of time. We would refer to the same a little later. We must, however examine the question in regard to alleged deficiency in service keeping in view the undisputed position that machines carried warranty of one year or 2000 hours of operation from the date of commissioning of the machines with the stipulation that the machines shall be serviced at 250 hours and 500 hours. What were the defects/faults which arose in the machines in question and what steps were taken by the opposite party to rectify those defects and whether the defects were eventually rectified or not, will provide the answer to this question.
20. In his attempt to show that opposite party have been deficient in providing the requisite service in the matter of timely repair of the machines and rectification of the defects Mr. Prabhakar, learned counsel for the complainants has mostly relied upon large number of service reports (59 in number) annexed with the complaints. The said reports were prepared by the service personnel / engineers of the opposite party on different dates at the time of repairing / servicing the machines in question. From the said service reports and the allegations made by the complainants in the complaints, the following instances of the alleged deficiency may be curled out:
(i) Excess consumption of oil i.e. engine oil, hydraulic oil and fuel in the machines;
(ii) Delay in repair of the machines and rectification of defects;
(iii) Non-replacement of the defective parts with the requisite spare parts.
21. We would like to deal with these instances one by one. In regard to the huge/excessive consumption of fuel and motor oil etc., by the machines, Mr. V.Prabhakar, Advocate emphatically contended that ample evidence and material has been placed on record to show that the machines were consuming excessive fuel and oil. In this regard, our attention has been invited to the service reports dated 16.02.1999 and 06.03.1999 appearing at pages 38 and 39 of the paper book. These service reports would show that the machine serial number 10258 was attended to on the complaint about the high engine oil consumption. The first service records the consumption of engine oil after a trial run of the engine was done for certain hours, which showed the extent of oil consumption. It would appear that service Engineer replaced the turbo charger and after doing so when test run was done again the oil consumption was found to be within normal specification. However, in the second service report, it is recorded that general performance of the machine was found to be O.K., except slight oil seepage from Engine-breather O-ring and second SVL Head Gasket, which was partially arrested by putting Teflon tape. Again consumption of engine oil was measured by working the machine for six hours on 03.3.1999 when the consumption of engine oil was found to be 0.5 ltr., and that of the diesel as 120 ltr., between 04.3.1999 and 05.3.1999, during which period the machine was worked for 18.5 hours and it showed the consumption of engine oil at 7.5ltr., and that of the diesel at 380 ltrs. In the remarks column, it is mentioned that “Smoke condition and load performance found to be satisfactory”. However, in the next column, an endorsement has been made by the certain S. Nawab on behalf of the complainants to the following effect- “Engine oil consumption is veryvery abnormal kindly replace this engine with new engine.”
22. Reference was then made to the communication dated 22nd December, 1998 appearing at page 65 and 66 of the paper book and dated 05.5.1999 at pages 158-159 of the paper book. In these communications, the complainant has detailed out the cost of excess engine and hydraulic oil consumed in the four machines. The total cost of excess oil consumed on the four machines for a period of about 300 days has been worked out at Rs. 7,73,795/- uptil the period of December, 1998. The communication dated 05.5.1999 gives out the cost of excess oil consumed between08.12.1998 to 30.4.1999 at Rs. 3,83,240/-. The opposite party was asked to settle the said amounts. The calculation of the extra amount incurred on extra oil consumed is stated to have been worked out, taking into account the standard for oil consumption as set out by the opposite party in the shop Manual where the oil consumption ratio to the fuel consumption had been given in percentage basis as 0.5% being standard value and 1.0% being optimal permissible limit. It is contended that the consumption of oil in the instant case is far beyond the permissible limit. A copy of the relevant extract of the shop manual has been filed at page 377/51 of the paper book. In the relevant column, relating to oil consumption ration at continuous rates output in relation to fuel consumption is stated as 0.5 as standard value and 1.0 as permissible value, meaning thereby that in ideal conditions, the consumption of engine oil should not be more than 0.5% and which could go upto 1% of the fuel consumption. Mr. Prabhakar submitted that taking the said value, the oil consumption was far excessive than the permissible limits.
23. On the other hand Mr. Sibal contended that the machines were periodically checked for oil consumption and in various service reports, the consumption of oil has been found satisfactory and within the limits and therefore, it cannot be said that the consumption of engine oil was higher. Moreover, it is sought to be explained that oil consumption depends on the maintenance and handling of the machine especially in difficult terrain in which these machines were operated. Further that if the machines were not handled properly then the oil consumption could go up considerably. Reliance of the complainant on the ratio of percentage consumption of oil to the fuel consumed is stated to be misplaced and irrelevant and does not correlate with any alleged excess oil consumption. It is also contended that in the answer to the interrogatories, the complainant had admitted that none of the people who operated the machine had read the manual of the machines.
24. Having considered the respective submissions, we have no hesitation to hold that complainant has failed to establish on record that the oil consumption of the engine oil was excessive as noted above in the service reports dated 16.2.1999 and 06.3.1999. The oil consumption in ratio of the fuel consumption i.e. diesel was within the permissible value. Moreover, the consumption of engine oil always depends on the conditions and the terrain in which the machines are used. The consumption of oil could vary if the machines were used in very severe/hard conditions and without giving the requisite rest. The service report would show that the opposite party had been providing service as and when any complaint was made in regard to the high consumption of oil or proper functioning of the machines and at times certain components were replaced whenever considered necessary to bring the consumption of oil within limits. Even, if it is assumed that there was some slight higher consumption of engine oil, the amount claimed by the complainant through their above referred communications could not have been justified. The calculation of the amount towards the extra cost incurred for the purchase of extra engine oil etc., appeared to be more imaginary/theoretical rather than real.
25. This takes us to the next alleged deficiency in service on the part of the opposite party in delaying the repair of machines and rectification of defects as a result of which the machines remained off roads / unutilized and resulting into business loss to the complainant. Mr. Prabhakar made a vain attempt by urging that delays of several days was caused due the service personnel/mechanics of the opposite party visited the machines and rectified the defects. By going through the 59 service reports annexed with the complaint during the period of about one year, it cannot be said that there was any delay in providing the requisite service. The machines in this case were deployed at distant places where the quarries of the complainant existed, which were far from the city of Bangalore and therefore, the opposite party would require some reasonable time to attend to the complaints made by the complainant in regard to the functioning of the machines. In any case no specific instances of delay in attending the complaints have been pointed out. From a perusal of the service reports, it is apparent that the machines which are the subject matter of the complaint No. 50 of 2000 were operated for 3029 hours and 1,900 hours respectively while that in complaint No. 51 of 2000 had operated for 4426 hours and in complaint No. 61 of 2000, the machine had operated for 1429 hours within a period of seven months. Going by the number of hours, the machines were worked after their commissioning. It cannot be said that the machines remained inoperative / idle for any such duration, which can be considered as unduly long duration resulting into any loss to the complainant. We cannot forget that the machines are heavy hydraulic excavators meant to be used in granite mining. It may therefore be not possible to put the machines to use on all the days and for most part of the day.
26. Going by the totality of the facts and circumstances and material brought on record in the shape of service reports, it is not possible to hold that there was any delay on the part of the opposite party to attend to the complaints. Rather the material on record suggest that the complaints made by the complainant were attempted with due promptitude. The figures in crores of rupees claimed towards the loss of net profit due to production loss on account of machines remaining non-functional appear to be imaginary and fanciful rather than having any sound basis for making such claims.
27. We would now examine the next instance of deficiency in service alleged by the complainant i.e. in regard to the non-replacement of the defective parts by suitable new spare parts. In this regard, it is pointed out by Mr. Prabhakar that the various service reports put on record will clearly spell out that there had been structural defects, defects in undercarriage hydraulic system and faulty engine. In this connection, reference is invited to the correspondence exchanged between the parties from February, 1998 to May, 1999 as also the Minutes of meeting held between the parties on18.05.1998 in order to sort out the problem relating to the replacement of the defective components with suitable spare parts. The first letter in the series is a letter dated 14.02.1998 by which the complainant pointed out certain defects which had developed in all the four machines and which required replacement. It would appear that on receipt of the said communication, the representative of the opposite party/BEML Mr. S. Nagendra, Regional Manager, Mr. Mylswamy and Mr. R. Venkatsubramanian met the complainant’s representative on 09.02.1998 at Salem in order to discuss the matter in detail and pursuant to that the BEML issued a letter dated 24.02.1998, which we would like to extract herein for facility of reference:
“BHARAT EARTH MOVERS LIMITED
REGIONAL OFFICE
BANGALORE
Ref. BEML/MA/MAS/KMB Dt. 24.02.1998
M/s. KMB Earth Movers,
4/59, Bharathi Street,
Swarnapuri,
SALEM – 636 004.
Kind attn.. Mr. K. Yusuf Basha
Dear Sirs,
Sub:- Performance of BEML BE300 Hydraulic Excavators
Ref:- Yr. letter no. Nil dated 14.02.1998
We are in receipt of your letter under reference. In this connection, please recall the discussions of our team including Mr. Mylswamy, Mr. R. Venkatasubramanian and the undersigned had with you on 09.02.1998 at Salem when the issues were discussed in detail. However, we are once again bringing the following facts to keep the records straight.
We have been deputing our Service Rep. for initial commissioning and periodical service of the equipment as and when required as confirmed by the corresponding service reports.
Eqpt S/N.
|
HMR/Date
|
Events
|
10257
|
21/8.11.1997
|
Initial commissioning
|
184/29.11.97
|
General inspection carried out. Slight oil leakage from bucketcyl. Lubrication oil filter head leakage noticed
Informed excessive wear of under carriage items due to misalignment of carrier rollers.
| |
300/14.12.1997
|
Periodical Maintenance carried out. Further, UT Rep also inspected and rectified minor problems.
| |
777/10.02.1998
|
General inspection carried out
| |
10258
|
24/6.11.1997
|
Initial commissioning. Slight oil leakage from Main pump.
|
190/28.11.1997
|
General Inspection. Arm bushing became oven. Items under despatch under warranty.
| |
352/15.12.1997
|
Periodical Maintenance. Eqptbeing used with non-standard Ripper Assyin place of bucket which lead to above failure. Customer has been informed in this connection.
| |
642/31.1.98
|
Periodical Maintenance. Lock bolt of trank tension spring loosened. Bolt under despatch. Eqptre-commissioned on 07.2.1998 by replacing the item from customer stock.
| |
684/8.2.98
|
Hair line crack observed on fly wheel housing. Item arranged.
| |
10260
|
20/27.11.97
|
Initial commissioning. Minor oil leakage – stopped
|
190/15.12.97
|
Periodical Maintenance carried out. Rectified the oil leakage from tube oil filter head.
| |
655/9.2.98
|
General Inspection. Oil leakage from Arm cylinder. Referred to M/s. UT for necessary action. Oil leakage observed from PTO case. Arranging parts from Mysore.
| |
10261
|
20/25.12.97
|
Initial commissioning.
|
24/25.12.97
|
Engine lugging
| |
62/31.12.97
|
Engine problem rectified
| |
80/8.1.98
|
T/Roller failure.
Parts handover on 05.2.98 at Hyderabad.
|
From the above you will observe that service Reps have been deputed at regular intervals to attend the periodical service. However, we have assured you that one Service Engineer will be visiting on weekly basis to assess the performance of the Eqpt. We have also arranged for all the warranty parts. Further we had arranged for all the required spare parts and kept them in our stock and because of the delay for lifting the same from your end, some items got diverted to other needy customer. However, we had since completed the supply of spare parts requirement including engine oil filters. We assure you that we stand by the commitments we have agreed to during finalisation. We also need your recommendation to other customers for opting of BEML Eqpt.
Regarding under carriage parts we had already informed you that for the granite application there may be earlier wearing out. However, we are arranging deputation of our production / R&D team to assess the cause of reasons for fast wearing of the under carriage parts. We once again assure you of our prompt service and harmonious business relationship we had so many years.
Thanking you and assuring you of our best services at all times,
Yours faithfully,
For BHARAT EARTH MOVERS LTD.,
Sd/-
(S. NAGENDRA)
REGIONAL MANAGER”
28. A communication dated 27.02.1998 issued by the complainant to the Regional Manager, BEML pointing out that the machine Excavator No. BE 300 Model S6D 125, serial No. G 10261 was idling from 26.2.1998 due to the following:
1. Idler support cut off
2. Complete undercarriage has gone.
- track shoe assemblies
- chain links
- rollers and etc.
29. On 27.02.1998, complainants shoot off two letters to the opposite party. One letter relates to defects in machine numbers G10257,
G10258 and G10260 and complainant giving reference to the previous letter brought it to the notice of the opposite party that the said machines were getting additional damages heavily and thereunder complete under-carriage had gone. The opposite party was requested to extend their help in arranging and supplying the complete under-carriage parts for the above referred machines in order to enable the complainant to get the same rectified and to avoid any further loss due to the delay in rectification.
G10258 and G10260 and complainant giving reference to the previous letter brought it to the notice of the opposite party that the said machines were getting additional damages heavily and thereunder complete under-carriage had gone. The opposite party was requested to extend their help in arranging and supplying the complete under-carriage parts for the above referred machines in order to enable the complainant to get the same rectified and to avoid any further loss due to the delay in rectification.
30. The second communication of the even date is in regard to the fourth machine i.e. serial number G10261 and it was complained that the said machine was lying idle from 26.9.1998 due to the following:
1. Idler support cut off.
2. Complete undercarriage has gone
- track shoe assemblies
- chain links
- rollars and etc.,
The complainant requested the opposite party to arrange for the supply of the under undercarriage parts in full and also indicated about the loss being sustained by the complainant due to the idling of the machine.
31. The above references were responded by the opposite party vide communicated dated 02.03.1998 in the following manner:
“BHARAT EARTH MOVERS LTD.
REGIONAL OFFICE
BANGALORE
Ref: BEML/MABE 300/10261 Dt. 02.03.98
To,
M/s. KMB Earth Movers
4/59, Bharathi Street,
Swarnapuri,
Salem 636 004
KIND ATTN. MR. YUSUF BASHA
Sir,
Sub: Performance of BE 300 Excavators
Ref: 1) Your letter ref. NIL dt. 27.02.98
2) Your letter ref. NIL dt. 27.02.98
This is with reference to your letter referred above and also to our telecom on 27.2.98 and wish to inform the following:
1) Our production team is expected to visit during this week for rectification of carrier refer problem on BE 300-10257, we will inform the detailed programme in a day or two.
2) As far as 10258 and 10260 are concerned, our quality engineering reps. Will visit and assess the performance of the under carriage parts and on the basis of their report, we assure you required remedial action will be taken immediately.
3) BE 300 sl. No. 10261 is working under the jurisdiction of the Regional Office, Hyderabad and we hear from them as below:
Our Service Engineer from Hyderabad will inspect the equipment to see the condition of under carriage parts. Immediately on his report suitable remedial action will be taken.
On 28.2.1998 we have handed over the following parts which we have received at Bangalore:
Sl.No. Part No. Description Qty.
1. 2077031160 PIN 1
2. 2073034191 LOCK 1
3. 0700013032 ORING 2
Above items have been collected by your rep. stationed at Bangalore
Extending our best attention to you at all times,
Yours sincerely,
Sd/-
M. MYLSWAMY”
32. This was followed by complainant’s reminder dated 09.03.1998, once again pointing out the defects of “abnormal worn-out in undercarriage”, rubbing of parts and parts chipped off even at the running of first 250 hours/500 hours and consequently the machines being almost “off road” condition for want of under carriage parts and impressing upon the opposite party to take necessary steps to supply the undercarriage parts under warranty for all the four machines. At the same time, the complainant expressed its anguish over the bad experience with the running of the machines and consequent monetary loss and mental harassment due to non-functioning of the machines.
33. It would appear that a joint inspection of four machines was conducted on 19.03.1998 by the service engineers of the opposite party/BEML. The inspection report was made which is to the following effect:
“INSPECTION REPORT ON BE300 MACHINES WORKING WITH M/S. K.M.B. EARTH MOVERS, SALEM
I. Equipt. No. G10257
Date of Delivery : 07.11.97
HMR 1035 / 10.03.1998
Job Location : Varahanapalli (Near Hosur)
Application : Granite Quarry
Machine inspected and following are the observation:
1. On RH side Idler outer flange rubbing with link resulting sprocket rubbing / chipping noticed in two places.
Track rollers from Idler 1, 2, 3, 4, 7 & 9 are found outer flange sharpened.
2. On LH Idler side Carrier roller flange rubbing with chain on outer side and link is not touching with the flange.
3. Three track roller found sharpened on LH side.
4. Cabin crack noticed at two places.
Local rework has been carried out on track frame both sides to maintain alignment and to avoid further damage on the under carriage components. Carrier roller repositioned.
Track tension maintained and performance of the equipment is under observation.
Status : Eqpt. On Road
II. EQUPT. NO. G10258
Date of Delivery : 06.11.1997
HMR 931 / 11.02.1998
Job Location : Devane Gounder, Edapadi (Near Salem)
Application : Granite Quarry
Machine inspected and following are noticed:
1. Track roller rubbing with track chain on both sides.
On LH side one track roller found deformed and RH side 4 track rollers flange found sharpened.
2. Track frame rework has been carried out to avoid further damage on the under carriage components.
3. Arm weld crack noticed at bucket mounting area and bushes found loose. Though rework carried out by Customer, collar of bush found loose on both sides causing lateral play during operation. Rewelded by Customer at site and Arm structure assembled to keep the machine on road.
Status : EQPT. On Road
III. EQPT. No. G10260
Date of Delivery : 27.11.97
HMR 961 / 13.03.98
Job Location : Thogamalai (Near Trichy)
Application : Granite Quarry
1. Inspected the machine and no abnormality on under carriage components observed at present.
2. Cabin crack noticed at two places.
3. LH side sprocket chipping noticed at 5 teeth
4. RH Boom cylinder supply tube flange oil leakage noticed due to porosity.
5. Track tension found incorrect and corrected to maintain standard value.
Equipment is working satisfactorily.
Status : EQPT. On Road
IV. EQPT. No. G10261
Date of Delivery : 24.12.97
HMR 511 / 17.03.97
Job Location : Cheemakurthi (Near Ongole)
Application : Granite Quarry
Machine inspected and the following observations noticed:
1. Track rollers rubbing with track chain on both sides.
On LH side 5 track rollers deformed on one side of the flange.
On RH side 1,2,3,4,5,6 & 7 track rollers are deformed.
2. Idler collar broken and subsequently bushes worn out, causing full damage to Idle assy. Idler assy. Needs immediate replacement.
Local rework has been carried out on the track frame to avoid further damage on the under carriage components and alignment ensured. One No. Idler assy. Of old machine replaced from customer’s stock. Cabin work returned at two places….
Signature of BEML’s representatives
1. N.G. VENKATESWARLU
2. K.G.V. BHAT
3. M. MYLSAMY
4. G.S. BALASUBRAMANIAN
On which the complainant made the following remarks:
CUSTOMER’S REMARKS
Equipment No. G 10257 and G 10258
In both the machines, the problems with the undercarriage are almost same.
Your service engineers has made temporary relief by welding with 6 mm and 12 mm plates, on both sides. This is not a permanent solution as you well aware and therefore you please arrange for recommissioning the machines at once with the supply of undercarriage parts with track frame under warranty.
Equipment No. G 10260
Your inspection have mentioned that abnormality undercarriage components at present but worn out is there. At the same time we could not depend with this as all the machines supplied recently to us are in the same batch.
Equipment No. G 10261
This equipment is with heavy damages among all our machines. Please note the temporary arrangements which your inspectors made at present are purely on temporary basis only which will make run the machines further to another so to 100 hours only. In addition to these, please refer all the previous service reports and arrange for recommissioning all our machines at once.
For your kind information Sirs. Excavators are backbone to run granite quarries. Your delay in recommission of machine will fetch heavy loss to us.
The status of equipments you mentioned as “On Road”. Even though you have given like this, almost they are “Off Road” conditions only.
Therefore, your immediate attention is highly expected.
Thanking you,
Yours faithfully,
For KMB Earthmovers
(K.V. BASHA)
Managing Partner”
34. It would appear that no concrete step was taken by the O.P. to replenish the undercarriage parts and therefore after about two months, a joint meeting of the representatives of complainant and opposite parties was held on 18.5.1998, minutes of the said meeting are quite relevant and we would like to extract the same:
“MINUTES OF THE MEETING HELD ON 18.5.1998 AT SALEM BETWEEN M/S. K.M.B. SALEM AND M/S. BEML, BANGALORE
The following officials were present:
KMB, SALEM BEML, BANGALORE
1. Sri KY Basha 1. Sri A. Maruthachalam, CGM(Quality)
2. Sri K. Haneef Basha 2. Sri NK Srinivasan, GM(Service)
3. Sri K Shoukath Ali 3. Sri Radhakrishnamurthy, GM(Quality)
4. Sri S Nagendra, Regional Manager
5. Sri Venkataswamy, Sr. Manager(Service)
Discussions held regarding warranty claims pertaining to the following equipments held by M/s. KMB.
Sl. No.
|
Type
|
Equpt. No.
|
Site
|
1.
|
BE 300 Excavator
|
10257
|
VaranganappalliQuarry
|
2.
|
BE 300 Excavator
|
10258
|
Edappadi Quarry
|
3.
|
BE 300 Excavator
|
10260
|
ThogaimalaiQuarry
|
4.
|
BE 300 Excavator
|
10261
|
Ongole Quarry
|
1. M/s/ KMB has sent their complaints to M/s. BEML by fax and letters dated 14.2.98, 27.2.98, 9.3.98 and etc., based on the service reports issued by BEML Service Engineers.
2. On the basis of service reports and personal inspection, M/s. BEML by its representatives Mr. NG Venkateswarulu, Mr. KGV Bhat and Mr. GS Balasubramanian has issued a combined Inspection Report to M/s. KMB which is self-explanatory. It clearly indicates that M/s. BEML has to supply various items of parts to M/s. KMB under warranty.
3. M/s. KMB has requested M/s. BEML that the following lists of parts are to be replaced under warranty.
a) Equipment No. 10257, 10258, 10260 and 10261
For each eqpt.
|
Total
| ||
i)
|
Track frame
|
1 no. x 4
|
4 Nos.
|
ii)
|
Track rollers with bolts and nuts
|
18 no. x 4
|
72 nos.
|
iii)
|
Idler
|
2 no. x 4
|
8 nos.
|
iv)
|
Sprocket with all bolts and nuts
|
2 no. x 4
|
8 Nos.
|
v)
|
Carrier roller
|
4 no. x 4
|
16 nos.
|
vi)
|
Track link assy.
|
2 no. x 4
|
8 nos.
|
vii)
|
Arm (stick)
|
1 no. x 4
|
4 nos.
|
Mm/s. BEML has also accepted that all the above parts are to be replaced for all the machines, in order to make the equipments to perform well and also to avoid “off road” conditions.
4. M/s. KMB has clearly pointed out that they do not like BEML equipments as they have been facing lot of problems with almost all the equipments even from the date of commissioning. For example equipment no. 10261 (Ongole Quarry) is idle (off road) from 30.4.1998 and M/s. BEML has failed to solve the problems till date.
5. M/s. KMB asked the following remedies from M/s. BEML.
a) That BEML has to take back all the four equipments
b) That BEML has to take back all the four machines by replacing new equipments or
c) If not possible for replacement of equipments, BEML should take back the equipments and money is to be returned to M/s. KMB or
d) BEML has to arrange for and recommission all the equipments immediately with supply of complete parts under warranty and should give warranty on this also
6. M/s. BEML indicated that their main aim is to convince M/s. KMB. Further disclosed that they are having concrete plans to take one equipment at a time and replace all the defective items thereby making it reliable.
7. Finally M/s. BEML has promised that they would rectify all the problems and all equipments would be recommissioned within another 30-40 days time. Further, M/s. BEML told that they would give full support for the recommissioning of all the four equipments.
Sd/- Sd/-
(K.Y. BASHA) (S. NAGENDRA)”
35. A perusal of the above referred minutes of the meeting would show that several important components like track frame, track rollers with bolts and nuts, Idler, Sprocket with all bolts and nuts, carrier roller, track link assembly and Arm (Stick) were required to be replaced in all the four machines and the opposite party/BEML has agreed to replace the same in order to make the equipment to perform well and to avoid “off road” conditions. That apart, in view of the bad experience, the complainant wanted the opposite party to replace all the four machines with new machines or if that was not possible to refund the price of the machines and in any case it must arrange for recommissioning of the equipments immediately by supplying complete parts under warranty and should give further warranty for performance of those parts. It was finally agreed that the opposite party shall rectify all the problems and all equipments would berecommissioned within a timeframe of 30-40 days and besides that they would give full support of commissioning of all the four equipments.
36. It would appear that pursuant to the decision taken in the meeting held on 18.5.98 that certain parts like Arm Assembly (three Nos.) and undercarriage parts except one track frame were supplied by the opposite party for which the complainant vide its communication dated 09.10.1998 expressed gratitude to the opposite party but at the same time pointed out that despite the supply of the undercarriage parts and track frame within the stipulated period, no one from the side of the opposite party had turned up to fix the said parts and recommission the equipments at the site where the machines were working despite the opposite party having been contacted several times. The complainant also pointed out that the equipment number 10261 detailed at Ongole Quarry of the complainant was passing through a bad situation so far as wear and tear of chains and rollers were concerned and the number of track frame and rollers and chain links were not supplied in adequate numbers and the opposite party’s mechanics had fixed the old chain links instead of new one. It was also pointed out that equipment No. 10257 and 10258 and 10260 were facing some problem as a result of which the functioning of the machines was stopped for every half an hour and on changing the link, bush and pin from the complainant’s own stock took another hour as a result of which production was adversely affected. In view of the difficulties faced by the complainant a request was made to the O.P. to supply the remaining track frame and shoe plates for item No. 257, 258 and 260 and all track rollers chain assembly for equipment number 261 detailed at Ongole quarry.
37. On 03.12.1998, complainant again took up the matter with the opposite party by thanking them for supply and commissioning of the machine number G10260 working at Thogaimalai quarry and pointing out that even after that there was heavy leakage from hydraulic pump, Servo valves and N.C. valves and therefore the service engineer recommended the replacement of 31 items / parts. Complaint was also made about the cracks having been developed in the Radiator. Regarding the other equipments, it was pointed out that the Komatsu engine was consuming heavy engine oil at 700, 650 and 800 hours. Reference is also made to the visit of the site service personnel from Mysore who suggested that if engine crank shaft rear seal was worn out there will be heavy oil consumption. It was suggested that crack shaft rear seal should be replaced in order to stop the leakage and excess consumption of oil. Many other defects were pointed out.
38. On 18.1.1999, the complainant once again invited attention of the opposite party about the persisting defects in the machines and the failure of the opposite party to supply and replace the requisite parts and accomplish the undercarriage work by stating as under:
“Hence we have put all these problems to your people by repeated letters and phones, and personal visits. And your service engineers made consequent trips to our equipment sites and they are well aware of the above problems. Your quality and R&D and your senior service people have all accepted the above problems and they have forwarded their technical reports for all the four equipments on 19.03.1998. After a lapse of two months (i.e. on 18.5.1998) the technical reports of quality R&D, your chief General Manager Mr. Maruthachalam (Quality) Regional Manager Mr. Nagendra, Senior Service Manager, Mr. Venkatasamy, Mr. N.K. Srinivasa, General Manager (Service and Mr. Radhakrishnamoorthy (Service) had a minutes meeting held at our office in Salem on 18.5.98. They all accepted for replacement of under carriages and ll other items for the four equipments for recommissioning within thirty to forty days from the date of that meeting. Since then from 19.3.98 more than nine months have passed your technical reports and your chief officials’ commitments and our equipments problems are not so far been rectified. Out of the four equipments only one equipment G10260 was commissioned with undercarriage and the second equipment G10258 the undercarriage work was also undertaken recently. So there are still two equipments pending for want of under carriage parts. During the past fifteen months from the date of commissioning, we have written lot of letters, made several phone calls and our representatives personal visits to your office there is no solution so far and the problems are still existing.”
39. Opposite Party/BEML promptly responded to the above communication by their letter dated 19.1.19999 by stating as under:
“We are in receipt of your letter dated 18.1.99. While we regret for the communication gap regarding the delay of the fourth modified track frame, we wish to bring the following to your kind attention:
Even though, it was agreed that the track frame on all the four nos. BE300 excavators would be replaced one by one by offering a new track frame for the first equipment and reworking the old track frame, in view of the delay experienced due to certain administrative reasons, such as Excise formalities which were beyond our control, our Senior Service Manager had assured with all sincerity to offer a new track frame, as a special case after taking Management’s approval. Due to the intervening holidays, making a new track frame ready would have taken atleast a weeks’ time. However, we are pleased to inform you that we have arranged one no. new track frame for despatch to your quarry, which would complete replacement of all the track frames. You are kindly aware that we have already despatched all the other under carriage items long back to your Ongole and Salem office.
Further, we have also deputed periodically our Engineers from Engine Division to study the oil consumption and other problems, if any, so that any improvement in performance could be obtained. We are pleased to inform you that necessary parts have already been sent and replaced for three equipments.
We assure you that all out efforts are on hand to meet your after-sales-service requirement, as you are one of our esteemed customer.”
40. Not satisfied with the kind of action taken and assurances given by the opposite party, the complainant again wrote a letter dated 30.1.1999 expressing much anguish about the manner in which the matter regarding the replacement of parts and rectification of defects had been handled by the opposite party/BEML. It appears that the opposite party addressed problems of the complainant and by a communication dated 06.2.99 informed the complainant in regard to various problems faced by the complainant in respect of the said machines by stating as under :
1. Track Frame:
Even though our regional Manager had confirmed that the Track Frame would be ready for despatch on 23.1.99, due to intervening holidays excise formalities could not be completed and hence we could not handover the forth track frame on the same day. While this has created a certain unpleasantness in your mind please be assured that this is mainly due to administrative problems and we had in fact arranged for a new track frame instead of repaired as agreed. The track frame has already been despatched videSudhir Transport GC No. 4067 dated 04.2.1999 and Truck No. GA01-W1458 and our production team will be deputed for commissioning immediately. With this we shall be completing the replacement of four Nos. Track frames.
2. Engine problem:
Earlier we have deputed our team from production to your site to analyse the oil consumption. Based on their assessment certain parts were also despatched and remedial actions were taken. However, based on your recent intimation we had arranged visit of our Chief of Services for Engine to Salem works on 31.1.99. However, due to your pre-occupation we have arranged the visit during this week end accordingly. We assure you that spot decision to rectify any problems and improve the performance of the engine will be given.
3. Spare Parts:
We had arranged for spare parts as per your earlier list along with the order. However, based on your revised list, spare parts are being arranged and the same will be ready for collection during this week.
While we have taken all actions to set right any problems faced by you by periodically deputing service engineers and by arranging of parts, there may be certain delay due to analysis of problem and release of required parts. We sincerely hope you will be with us for the delay as we consider KMB is one of our esteemed customers.
We once again assure you that all out action has been taken to ensure prompt supply of parts and after-sales-service.”
41. On 2nd March, 1999, the complainant invited the attention of the opposite party about their machine No. G10257 being off the road from 08.12.98 and the complainant having suffered production loss due to non-functioning of the machine. As regards machine No. G10258, it was pointed out that the same stopped for change of track frame with undercarriage and it was also off the road from 25.12.98 and was recommissioned only in second week of January. In regard to machine No.G10260 it was complained that it was consuming excessive engine oil and the complainant was required 1.5 ltr. of engine oil and hydraulic oil because of heavy leakage in control valve and hydraulic pump. Attention of the opposite party was also invited about the difficulty being faced by the complainant due to not meeting the requirement of the foreign order and the embarrassment suffered by them at the hands of the foreign buyers.
42. A fax dated 26.4.99 was also sent by the complainant inviting the attention of the opposite party about the kind of loss being suffered, which was responded by the opposite party vide communication of even date i.e. 26.4.99 by stating as under:
“Sub: BE 300 Sl. No. G10260 working at Thogamalai Quarry
Please refer your fax dated 26.4.99 regarding seizure of BE300 Engine.
As discussed, we are deputing our representative shortly to see the equipment. In this connection, we wish to bring to your kind attention that during the visit of our Col. Narayanpatige it was informed that the necessary items have to be replaced immediately in respect to the engine to improve the performance. This was also confirmed vide letter No. BEML/S/102/3524 dated 02.3.99 from our General Manager (Service). However, it is noted that you have not agreed to consider our solution. Under the circumstances, the replacement of engine under warranty does not arise. Any further action will be taken after the report of our service engineer.”
43. Ultimately on 06.5.1999, the complainant expressed their disappointment and harassment for not being able to meet the foreign order due to non-functioning of their machine Sl. No. 10258 detained at Edappadi and also machine No. 10260 detained at Thogamalai Quarry, which was stated to have ceased from 24.4.99.
44. The above referred correspondence exchanged between the parties makes it manifest that several defects had developed in all the four machines during the warranty period, which defects were such, as would require replacement of certain major components of the machines. These components related to the track frame and track line assembly etc., with incidental parts. This is also apparent from the minutes of meeting held on 18.5.1998 between the representatives of the complainant and senior functionaries of the O.P., wherein certain decisions were taken to supply /replace the requisite spare parts. It would appear that though most of the spare parts required for the three machines were supplied but the track frame in respect of machine no. 10261 was not supplied uptil January, 1999. In our view, the above material unerringly show that despite the service engineers / personnel of the opposite party promptly attending to the complaints, the defects in machines could not be fully rectified as certain spare parts required to be replaced were not supplied promptly. According to the opposite party, the delay in supply the parts were due to exigencies of service. Whatever may be the circumstances, the fact remains that due to non-supply of the spare parts or delay in supplying of the spare parts by the opposite party, the machines of the complainant must have remained non-functional / idle / off the road for various durations even during warranty period. Therefore, it can be safely presumed that awaiting the replacement of these defective / worn out parts, the complainant must have purchased some spare parts from the open market to make the machines running.
45. Thus having considered the matter from different angles, there is no escape from the conclusion that the complainants have successfully established on record certain acts of omissions on the part of the opposite party in not supplying of the spare parts or causing substantial delay in supplying the major spare parts needed for recommissioning the machines. In our view, the opposite parties are squarely guilty of deficiency in service atleast to this extent.
46. This takes us to the ultimate question as to the award of compensation to the complainant on account of the loss and injury occasioned to the complainant arising out of the said deficiency. We may at the outset note that the complainant has claimed astronomical compensation amounting to several crore of rupees i.e. more than Rupees two crore in respect of each of the four machines towards the business loss and injury suffered by the complainant. The claim of such huge compensation appears to be wholly imaginary and not based on real statistics. For instance claim of more than Rupees three crore towards the net profit due to production loss is too remote and by no stretch can be justified. The complainants are of course entitled to legitimate compensation so as to indemnify them for the loss and injury suffered by them in a just manner. We accordingly propose to compensate the complainant on the following two counts:
(i) For the delay in supply of the spare parts and the resultant loss which might have been occasioned to the complainant.
(ii) Cost of spare parts which the complainant claims to have purchased from the open market.
47. Going by the extent of delay in supplying the spare parts in particular the undercarriage and other related parts required for the recommissioning of the machines, we would like to quantify the compensation for the three machines Nos. G 10257, G 10258 and G10260 for which track frame etc., were supplied by July-August, 1998 @ Rs. 2,00,000/- (Rupees two lacs only) per machine and in respect of the fourth machine No. G 10261 for which the track frame was not supplied uptil January, 1999 @ Rs. 3,00,000/- (Rupees three lacs only) because delay was more than six months in supplying the spare parts in respect of this machine.
48. Now coming to the compensation under the second head i.e. towards the cost of spare parts acquired by the complainant from the open market in order to keep the machines running, the complainant has filed number of invoices / vouchers from different suppliers evidencing the supply of various spare parts to the complainant, However, on a closer scrutiny, we find that the said invoices / vouchers cannot be accepted on their face value as the same do not appear to be true repositories of the cost incurred by the complainant in purchasing the spare parts required for the machine in question. We say so because these invoices / voucher do not contain the machine number and model for the use of which spare parts were procured. It is an admitted position that the complainants’ company has a fleet of such machines numbering more than 30, of course of different models and therefore, the possibility of the complainants having purchased the spare parts for use in the machines other than the machine in question cannot be ruled out. It was therefore, incumbent upon the complainant to have established by means of cogent evidence to establish that the spare parts purchased by the complainant through these invoices / vouchers were in fact meant to be used and were actually used by the complainants in the four machines in question and in no other machines. It also appears to us that the complainant has not approached this Commission with clean hands atleast so far as his claim of spare parts is concerned. This is so apparent because the complainant has filed certain invoices of date 16.7.1997 issued by certain DIAJ Pvt. Ltd. In regard to the purchase of certain spare parts. This voucher certainly pertains to the period prior to the date of commissioning of the four machines in question and therefore by no stretch, purchase under this voucher can be correlated to the spare parts purchased by the complainant in respect of the machines in question.
49. According to the complainant, he had spent sums of Rs. 4,36,010/-, 5,39,444/-, 6,51,560/- and Rs. 12,13,796/- respectively towards the purchase of spare parts used in four machines. In view of the fact that the complainant has failed to establish the purchase of the spare parts to the above extent, we are of the considered opinion that these amounts claimed by the complainant are far too excessive to be granted. However, we will not non suit the complainant all together in this regard because going by the entirety of the facts and circumstances of the case and that the machines were heavy engineering machines meant for granite quarrying, the complainants must have purchased some spare parts in order to ensure that the machines were not off the roads and continued to operate without awaiting the spare parts to be supplied by the opposite party Under the warranty attached to the sale of the machines, the opposite party had undertaken to supply spare parts worth upto Rupees one lac for each machine. From the material brought on record, we have reasons to believe that complainants must have incurred expenditure on purchase of spare parts from the open market, besides the spare parts supplied by the opposite party worth not less than Rupees. one lac for each machine. We therefore consider it appropriate to grant a sum of rupees one lac towards the cost of spare parts purchased by the complainant from the open market in respect of each of the four machines.
50. In view of our above discussions we hold that the complaints filed by the complainants deserve to be allowed partly in the following manner:
(i) In Consumer Complaint No. 50 of 2000 relating to equipment serial number G 10258 and G 10261, the complainant is entitled to a compensation of Rs. 7.00 lacs (i.e. Rs. 2.00 lacs towards the loss of business in respect of equipment number G 10258 and Rs. 3.00 lacs in respect of equipment No. G 10261) and a sum of Rs. 1.00 lac towards the cost of spare parts in respect of each of the two machines;
(ii) In Consumer Complaint No. 51 of 2000 relating to equipment serial number G 10260, the complainant is entitled to a compensation of Rs. 3.00lacs i.e. Rs. 2.00 lacs towards the loss of business and Rs. 1.00 lac towards the cost of spare parts;
(iii) In Consumer Complaint No. 61 of 2000 relating to equipment serial number G 10257, the complainant is entitled to a compensation of Rs. 3.00 lacsi.e. Rs. 2.00 lacs towards the loss of business and Rs. 1.00 lac towards the cost of spare parts.
51. Since the said amount of claim of the complainant was not settled/paid by the opposite party within a reasonable time even after legal notice, we propose to further compensate the complainants by awarding interest @ 9% per annum on the above amounts with effect from the date of filing of the complaint till payment.
52 In the result, we partly allow the three complaints and direct the opposite party as under:
(i) To pay a sum of Rs. 7.00 lacs to the complainant along with interest @ 9% per annum with effect from the date of the complaint till payment in Consumer Complaint No. 50 of 2000;
(ii) To pay a sum of Rs. 3.00 lacs to the complainant along with interest @ 9% per annum per annum with effect from the date of the complaint till payment in Consumer Complaint No. 51 of 2000;
(iii) To pay a sum of Rs. 3.00 lacs to the complainant along with interest @ 9% per annum per annum with effect from the date of the complaint till payment in Consumer Complaint No. 61 of 2000;
53. The opposite party is called upon to make the payment of the awarded amount to the complainants within a period of six weeks from the date of this order, failing which the rate of interest shall stand enhanced to 12% per annum with effect from the date of default.
54. In the facts and circumstances of the case, parties are left to bear their own cost.
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(R. C. JAIN, J.)
PRESIDING MEMBER
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(S.K. NAIK)
MEMBER
SB/2
